Talk:Network marketing

Merge

 * This merge section and the two "yes" posts are nearly 3 years old and a relic of past articles. For the current merge discussion see Talk:Multi-level marketing

Yes, both terms are about the same thing. Multi-level marketing is probably the most used word. // Liftarn —Preceding undated comment added 09:35, 5 June 2006 (UTC).

Yes Pyramid Scheme, is also the same thing - Albiet somewhat derogatory —Preceding unsigned comment added by 70.68.250.144 (talk • contribs) 00:15, 12 September 2006 (UTC)

Merge Article has nothing that shows that this is not just an another method of MLM as proven by five scholarly papers across three different professions (business, anthropology, and medicine). By claiming otherwise this article is nothing more than a violation of WP:CFORK--BruceGrubb (talk) 10:25, 3 July 2009 (UTC)

Merge into Network Marketing. While I appreciate the perspective of those who want to keep the articles seperate, until such usage becomes more widespread and discussed in third party articles, we have to go with what we have. I'm yet to see any RS/V source that treats the two differently, and many that say it's the same. What term to use for the merged article is debatable. It seems to me that MLM is an older term, and network marketing the more modern usage. There is also the issue that many pyramids are calling themselves MLM that many people now think MLM and pyramid scheme are the same (see above!). Indeed some companies using a multi-level compensation plan are explictly stating they are NOT mlm. So merge MLM into NWM, and address the issue of pyramid scams pretending to be MLM. --Insider201283 (talk) 11:19, 4 July 2009 (UTC)


 * Actually there is at lease one scholarly paper that says pyramid selling is a form of illegal MLM. Schmidt, Andreas U. (2006)"Multi-level markets and incentives for information goods" Information Economics and Policy Volume 18, Issue 2, June 2006, Pages 125-138--"Multi-level marketing carries negative connotations and is illegal in special forms known as pyramid selling, snowball systems, chain-letters, etc."--BruceGrubb (talk) 02:33, 7 July 2009 (UTC)
 * Oh, I'm sure there's more than one! Confusion over terminology is rife - as you've just demonstrated, for pyramid selling is yet another term, and is not the same as Pyramid Scheme. In some countries in the past legal MLM was called Pyramid Selling in statutes (eg UK), however EU directives now explictly state Pyramid Selling is illegal but allow Multi-level Marketing. Cleverly of course they neglect to define exactly what the difference is. My understanding, though I've never been able to find a clearly written RS to confirm it, is that "pyramid selling" is essentially a type of pyramid scheme with some kind of bogus product used to hide it's nature. Alas, I suspect an awful lot of companies that call themselves MLM may fall under this description. There is no clear definition of these terms, and virtually any perspective can probably be backed up by some reasonable quality source or another. Given the increasing reliance on Wikipedia by the public and media types, I think what we end up writing here may have a significant effect on the generally accepted meanings of the terms, so we need to be extremely diligent in writing these articles. Clearly one aspect that needs to be addressed is the confusion! --Insider201283 (talk) 16:45, 7 July 2009 (UTC)
 * I seem to remember reading about that but it wasn't RS so I didn't reference is. When I went back looking for it under "Pyramid Selling" I only got stuff on the illegal version.  I should mention that pyramiding is also a common problem iwth some MLM putting regaudless of theor other merits into illegal territory in many states.--BruceGrubb (talk) 18:55, 8 July 2009 (UTC)


 * On this subject, here is an article from Forbes.com explicitly using the terms "pyramid selling scheme" and separately "pyramid" and "scheme" all to describe multi-level marketing. Forbes is generally considered RS, yet as we've pointed out through other undeniable RS (such as the FTC reports) there is a difference between pyramid schemes and multi-level marketing...and then as pointed out above, throwing the word "selling" into the mix opens a whole new can of worms.


 * All of this is just further evidence that many different terms may be used interchangeably, but it does not mean they are the same thing. Examples of this are found everywhere: bar, pub, tavern, and club...the words "toilet" and "restroom"..."stereo" and "radio"..."money" and "cash".  One could produce plenty of RS that would confirm the fact that those terms are used interchangeably...again, that does not make them the same thing.  --JohnDoe0007 (talk) 08:02, 10 July 2009 (UTC)


 * If they're used interchangeably, and there is no reliable source which describes the difference, we cannot have separate articles. Please supply a source for the difference.... — Arthur Rubin  (talk) 08:10, 10 July 2009 (UTC)
 * I may have to change my vote :) I've been collating references from this field and found the following -
 * Similarly, Network Marketing has a number of meanings, with some literature referring to it as a form of multi-level marketing or pyramid selling (Fogg 1995; Croft and Woodruffe 1996) or vertical integration (Johnston and Lawrence 1988). On the other hand, it has also been defined as "...the creation, utilisation, and maintenance of [a] network [of relationships between firms]" (Gummesson 1994). To add to the confusion, the terms Interaction Approach and Relationship Marketing seem to have been used interchangeably in the literature (e.g. Gronroos 1990a, 1992, 1994a; Morgan and Hunt 1994), and Network Marketng is not always clearly distinguished from Relationship or Interaction Marketing (e.g. Gummesson 1994).
 * Roderick J. Brodie, Nicole E. Coviello, Richard W. Brookes and Victoria Little (1997). Towards a Paradigm Shift in Marketing? An Examination of Current Marketing Practices. Journal of Marketing Management, 1997, 13, 383-406
 * In Understanding Contemporary Marketing: Development of a Classification Scheme Coviello, Brodie, and Munro expound further on Network Marketing and the whole section has pretty much nothing to do with MLM as most here consider it. Some quotes - "In this perspective, multiple, networked relationships between firms are the focus of Network Marketing", Based on these definitions. Table 4 shows that Network Marketing occurs across organisations, where firms commit resources to develop positions in a network of relationships (Johanson and Mattsson 1985, 1988)., Furthermore, Network Marketing may be conducted at a general management level {Groonroos 1994) or by "part-time" marketers from other functional areas in the organisafion (Gunvmesson 1994), or even outside the organisation.--Insider201283 (talk) 13:07, 10 July 2009 (UTC)

Does that suffice, Arthur Rubin? --JohnDoe0007 (talk) 23:21, 10 July 2009 (UTC)
 * Well, I think we need to get hold of more of these sources to be able to actually write and source an articles differentiating them. What I'm concluding is that network marketing is a marketing strategy. Multi-level marketing is a misnomer, as it's not even a form of marketing, it's method for compensating the "sales field". To confuse things further, some consider there to be both legal MLM and illegal MLM. Illegal MLM includes pyramid schemes. The confusion arises because numerous jurisdictions have stated MLM is legal and pyramid schems are not, which makes no sense if the latter is a subset of the former. To confuse it even further there is pyramid selling. In some sources this is essentially a product-based pyramid scheme, and illegal, in other sources it is used to describe legal multi-level network marketing. I need to get a hold of some of the more authoritively authored books and see what they say on the topic. --Insider201283 (talk) 09:48, 11 July 2009 (UTC)

Obviously more authoritatively authored books would be good. Those descriptions are more or less what I've been trying to illustrate. Notice a few posts above I linked to a Forbes article explicitly using the terms "pyramid selling scheme" and separately "pyramid" and "scheme" all to describe well-known, large multi-level marketing companies. --JohnDoe0007 (talk) 12:01, 12 July 2009 (UTC)
 * I'm wondering if perhaps the main article should be "direct selling". The majority of direct selling firms use MLM plans and quite a bit of the research is on direct selling rather than NWM/MLM per se, though it obviously applies. Just read an interesting global survey by the University of Westminster actually, they found that people who have actually bought from a direct selling company are generally very positive about the experience. Most of the "negative" people are the ones with no personal experience, essentially basing their experiences on hearsay. --Insider201283 (talk) 00:22, 13 July 2009 (UTC)
 * "Most of the 'negative' people are the ones with no personal experience, essentially basing their experiences on hearsay." ...As is the case with pretty much anything that only a minority of people have experience with.  A lack of experience/familiarity with pretty much anything breeds fear and a host of other negative emotions that manifest themselves in myriad ways...generally negative. --JohnDoe0007 (talk) 12:38, 21 July 2009 (UTC)
 * Direct Selling is a totally different thing and given the vote there is no reason to kee this article anymore.--BruceGrubb (talk) 10:17, 1 September 2009 (UTC)
 * Um, no. All multi-level/nwm companies are direct selling companies, and virtually all direct selling companies are mlm/nwm companies. "totally different" doesn't quite reflect reality. Network Marketing is a marketing strategy. MLM is a compensation strategy, though used also as marketing of the opportunity. I'd suggest the MLM article focus on compensation plans, the NWM article focus on the WOM marketing strategy, and direct selling on the industry itself. The articles do however need to refer to the fact that MLM and NWM are often used interchangeably. --Insider201283 (talk) 15:59, 1 September 2009 (UTC)
 * I fully agree with the vast majority of Insider201283's statement above. There is room for discussion on his suggestions as to the focus of each article, but his direct response is spot on.  There is certainly a need for separate articles.  --JohnDoe0007 (talk) 09:19, 2 September 2009 (UTC)


 * No - There are differences. Pyramid selling is also different, so that should not be merged, Network marketing is legal in the UK, and carried out legitimately by many companies, Avon, Bettaware, Kleeneze, Utility Warehouse to name a few.  A pyramid scheme is illgeal, the difference being that one is paid for recruiting a person downline, where as in Network Marketing commision is only given on products/services sold to none members.  Network Marketing can to some degree taken on a similar structure to a pyramid scheme, but the difference is that the money is made via completely different means.  A pyramid scheme of-course guarantees that seven in eight people will lose out regardless how large the pyramid becomes.  If Network and Multi-Level Marketing are to be merged, then it should be done under the name 'Network Marketing' as this is a far more widely used term. Mtaylor848 (talk) 16:59, 10 September 2009 (UTC)

Article improvement
Unless it's significantly expanded with sourced material, it still should be merged with MLM. The fact that they are not identical, even though they are used identically, could be noted in a section of MLM if that's all you can say about Network marketing not MLM. Particularly, an example of a company using networking marketing without using MLM would be of interest to show the distinction. — Arthur Rubin (talk) 16:18, 26 June 2009 (UTC)
 * It's improved, but not really sourced. Neither FTC source discusses network marketing at all; they distinguish MLM from pyramid schemes.  — Arthur Rubin  (talk) 07:12, 28 June 2009 (UTC)
 * Both of those sources mention how the two terms are used interchangeably and the second one does differentiate when speaking about a settlement claim: "The settlement requires the defendants to pay $1 million in consumer redress, bars them from further pyramiding activity of any kind, requires them to post a bond before engaging in any network marketing, and requires them to register with state utility officials before engaging in the sale of electricity."


 * A pyramid scheme is illegal. There is no need to bar anyone from doing it in a court setting. The settlement is basically saying the company can no longer run any sort of multi-level structure with a hierarchy and must post bond before it can even engage in any sort of marketing that allows or encourages independent representatives to market the company products to their own social networks.


 * And there were citations provided throughout the additions. The tag you added which states the section "does not cite any references or sources" is completely inaccurate.  You might wish to use the refimprove template, but even more so it would be useful to use the fact template to specify where you think more citations are necessary.


 * I see the sense in the removal of the top image, but not for the removal of the marketing template. There is no reason it should not be present. Did you remove it along with the image on accident?  I will add it back. --JohnDoe0007 (talk) 07:38, 28 June 2009 (UTC)


 * No, that last was an accident.
 * Looking closely, one of the FTC sources says MLM is also known as "network marketing", but neither source distinguishes MLM from network marketing.
 * There were no references in that section. If my tag appeared to apply to the entire article, I apologize.  There seems to be a difference between  and unreferenced-section, although why there is, I do not know.  — Arthur Rubin  (talk) 08:05, 28 June 2009 (UTC)
 * The settlement in the second reference distinguished pyramiding from network marketing; there's still no evidence there that the FTC considers MLM and network marketing to be different. — Arthur Rubin  (talk) 08:08, 28 June 2009 (UTC)
 * I wouldn't necessarily argue with that statement. The FTC didn't seem to explain what they meant by "pyramiding" or even what they considered that to include. It's possible actual court documents could provide more detail, but that's assuming they're available to the public (which in that case they may not be) and also that the government is going to give clear explanations of anything. I appreciate your conduct regarding all this and I'm sure at some point the community (or at least us few folks working on these articles) will be able to have them up to a higher grade classification. --JohnDoe0007 (talk) 08:26, 28 June 2009 (UTC)
 * John, your article here has convinced me the terms should be considered differently, however it appears to be WP:OR and I can't see any justification for it from a Wikipedia perspective. There's multiple reliable sources saying they're the same thing, but none I know of that differentiate them. Have you read any of the various recent books on NWM/MLM? They perhaps differentiate, now that affiliate marketing, which would appear to clearly be a form of marketing through a network, is so common. --Insider201283 (talk) 02:04, 29 June 2009 (UTC)
 * To be perfectly honest, I haven't seen any sources (that are reliable enough for our encyclopedia) that clearly differentiate OR say they are the same. The only truly reliable ones are the FTC docs discussed in this section above. They mention how the words are used interchangeably, but as I said earlier, the one actually then goes on to differentiate "pyramiding" from network marketing...and it obviously wasn't talking about a pyramid scheme, as that is already illegal and a ban on it would not have to be included in a legal settlement.  It leads me to at least believe the FTC differentiates, but does not necessarily wish to clarify..because it would open more doors for malicious or fraudulent activity due to companies using the differentiated term.  For example, it used to be known as "pyramid selling," yet because a pyramid scheme is illegal, the term multi-level marketing is used instead.  --JohnDoe0007 (talk) 04:19, 29 June 2009 (UTC)
 * Here's a fascinating read if your up to it - a relatively recently published PHD dissertation on NWM. Some of it's pretty tough going, but it gives a good review of the problems understanding the area - Oksanen-Ylikoski, Elina. (2006) Businesswomen, dabblers, revivalists or conmen? : representation of selling and salespeople within academic, network marketing practitioner and media discourses.--Insider201283 (talk) 23:57, 12 July 2009 (UTC)

(remove Indent)
 * "In network marketing also known as network direct selling or multilevel marketing)," (Pratt, Michael G. and José Antonio Rosa 2003) "Transforming work-family conflict into commitment in network marketing organizations" The Academy of Management Journal Vol. 46, No. 4, pp. 395-418

Five different articles cross several different professions that all say multi-level and network marketing are the same thing.--BruceGrubb (talk) 10:37, 4 July 2009 (UTC)
 * ...multilevel marketing (MLM), also called “network marketing,” dramatically increased... (Vander 2002) "Marketing Fraud: An Approach for Differentiating Multilevel Marketing from Pyramid Schemes" Journal of Public Policy & Marketing Volume: 21 Issue: 1 139-151
 * "Multilevel selling or multilevel marketing is also known as network marketing..." (Merrilees 1999) "Direct Selling in the West and East: The Relative Roles of Product and Relationship (Guanxi) Drivers" Journal of Business Research Volume 45, Issue 3, Pages 267-273
 * "Multilevel marketing (also known as network marketing and MLM)" Cahn, Peter S. (2006) "Building down and Dreaming up: Finding Faith in a Mexican Multilevel Marketer" American Ethnologist Vol. 33, No. 1, pp. 126-142
 * ... It is sold worldwide via the internet in a multi-level (network) marketing system. Marcason, Wendy (2006) "What Are the Facts and Myths about Mangosteen?" Journal of the American Dietetic Association Volume 106, Issue 6, Page 986